I am at loss towards the tech-landscape right now. A year ago, everyone was talking about hot the market was and how you could easily switch jobs for a 40% raise. Now all the megacorps are doing lay-offs and here comes Nintendo with the opposite approach. Why are the business decisions between Ninendo and the tech-giants so different? Would anyone have been surprised to see "Nintendo will lay of 10% of its workers" ?
The explanation is in the original article (not Gamespot):
> The hefty pay hike comes amid calls by Prime Minister Fumio Kishida for Japanese companies to pay workers more as inflation takes hold in an economy used to years of deflation and stagnant wages, and as Japan prepares for its annual spring round of labour negotiations.
> "It's important for our long-term growth to secure our workforce," Nintendo President Shuntaro Furukawa told an earnings briefing.
> For companies that can afford to do so, higher salaries may also help them attract talent as a falling birth rate and low immigration leave Japan with serious labour shortages.
Basically, hiring is harder in Japan, companies are adjusting in order to attract talent. In the US, companies made the mistake of hiring too much, and doesn't suffer from the same problem, so different solution needed.
> calls by Prime Minister Fumio Kishida for Japanese companies to pay workers more as inflation takes hold
So the prime minister wants to fight a phenomenon caused (in large part) by a wage price spiral by calling for accelerating the wage price spiral... we're in for a fascinating macro-economic/political landscape these next couple years...
Japan’s current inflated prices are more visible on gas and electricity which increased by 25~30% in just a few months, and are planned to increase again in the summer.
The PM is basically asking companies to foot the bill for energy costs, which have little to do with wages.
Imported goods have been directly affected by the usd/eur/jpy exchange rate, so yes they rose too. Exchange rate has been slightly going down, so there’s a modicum of hope in this regard.
So, 4% incrises in average prices cause by the sour of gas prices and comoditiess, means employees cause the inflation.
Or b what he wants is the distribution of the Cost of being share between companies and employees.
The inflation Japan is experiencing has not been caused in large part by a wage price spiral. It has largely been caused by US and Japanese monetary policy being out of sync.
Cost of raw material going up (largely due to moving resource extraction away from slave labor) is a much bigger driver of inflation than wages. If 10% of a product's price is to pay for the overhead of personnel costs, a 10% wage increase only increases the price of the product 1%.
american tech leaders are just herding, basically responding to investor sentiment which regards the tight employment market as the cause of inflation, which is killing the real value of their wealth in equities. is the tight labor market the cause of the current inflation? maybe. will layoffs curb inflation and boost equity prices? maybe. maybe not! but the fever has taken hold and if you are in senior leadership of a big tech company you are looking around and wondering why aren’t you laying people off too. japanese companies just don’t have the same relationships, the same board membership cross polinations, the same social circles etc. it’s easier to recognize that it’s better for the health of your company to have happy employees with loyalty and motivation than distrusting workers who are all wondering when the axe is coming for them
Could it be the same mentality as a copycat crime?
When a corporate executive sees a competitor decimate themselves without facing immediate consequences, they start to think that they could probably get away with it, too.
I think you have to look at the converse for why they're stable. Even when things are going really well, Nintendo grows very slowly. They don't take large risks outside their core business. Sounds like they believe they're in a position of having the right employees and working on right things, but at the wrong time for market conditions. A lot of the companies doing layoffs have large risky divisions that they don't believe in.
Yup and the PM of Japan is asking companies to pay more. Nintendo is answering the call.
> As inflation continues to hit the global market, Japan Prime Minister Fumio Kishida urged companies to pay more to offset the rising cost of living. Nintendo President Shuntaro Furukawa said, "It's important for our long-term growth to secure our workforce."
> Yup and the PM of Japan is asking companies to pay more. Nintendo is answering the call
It's never as simple as that. Toeing the party's line to help re-elect some politician isn't what has made Nintendo a lasting enterprise spanning 133 years of existence.
Like, by a huge factor, at least according to Patio11. Think like 2-6x lower. A 10% raise on that is relatively significant, but does not get you close to US dev compensation.
US, Lead Dev position, I just received a 6.5% pay increase this last month. Folks massively overhired last year, they're mostly still doing fine however, and there's a correction going around for that. It may end up that things get a bit worse this near necessitating what I would consider a _real_ round of layoffs, but we're not quite there yet (Zoom and the like being the exception given their reliance on remote/at-home focused clients).
I think there's a confusing narrative here, where people think layoffs is the same as not hiring or paying less. The market is still hot for roles that are competitive. It's still easy for many good engineers to switch jobs for a 40% pay increase, and in ML people are making more than they ever have at large US tech companies.
This tracks with my experience (WARNING: Anecdotal evidence incoming). I'm currently aggressively hiring for development roles (in particular around data). Despite the layoffs our candidate pipelines are only modestly bigger and the quality level is similar to before. Layoffs haven't really moved the market down very much except for some pretty major outliers where someone was being paid pretty far above market.
> It's still easy for many good engineers to switch jobs for a 40% pay increase, and in ML people are making more than they ever have at large US tech companies.
Uh... I'm not sure that's the case here otherwise those folks would have been reassigned instead of laid off.
Layoffs have to be across the board / department, otherwise that would open the company up to even more lawsuits. They can’t special-case ML engineers out. This does not mean the company does not need or is aware it needs ML engineers elsewhere in the company.
> They can’t special-case ML engineers out. This does not mean the company does not need or is aware it needs ML engineers elsewhere in the company.
In the case of META, Amazon, some of the layoff target was shutting down the whole Org/Div/Product Group. In these cases, shouldn't they be able to re-assigned a few folks to another team?
But like I said, they can move these ML if they actually truly need it.
Reassigning folks would defeat the point of having a layoff, which is to be seen as having a layoff (taking difficult actions in the light of new macroeconomic conditions, etc, etc).
The layoffs in the US market are collusion to bring down salaries plus copycat effects from smaller companies. The hedge funds are driving this because they're greedy fucks.
